October 2015 Trends - Alaska Dept of Labor · 2 OCTOBER 2015 ALASKA ECONOMIC TRENDS OCTOBER 2015...

2 ALASKA ECONOMIC TRENDSOCTOBER 2015

OCTOBER 2015Volume 35 Number 10

ISSN 0160-3345

Alaska Economic Trends is a monthly publica on whose purpose is to objec vely inform the public about a wide variety of economic issues in the state. Trends is funded by the Employment and Training Services Division of the Alaska Department of Labor and Workforce Development and is published by the department’s Research and Analysis Sec on. Trends is printed and distributed by Assets, Inc., a voca onal training and employment program, at a cost of $1.37 per copy. Material in this publica on is public informa on, and with appropriate credit may be reproduced without permission.

Sam DapcevichCover Ar st

Sara WhitneyEditor

To request a free electronic or print subscrip on, e-mail [email protected] or call (907) 465-4500.Trends is on the Web at labor.alaska.gov/trends.

Dan RobinsonChief, Research and Analysis

Bill Walker,Governor

Heidi Drygas,Commissioner

ON THE COVER: Check photo by Sam Dapcevich

ALASKA DEPARTMENTof LABOR

and WORKFORCEDEVELOPMENT

ALASKA MIGRATION and U.S. RECESSIONS

The RISE of COFFEE SHOPS

WORKERS and WAGES

PAGE 11

PAGE 9

PAGE 4

By NEAL FRIED

By NEAL FRIED

By MALI ABRAHAMSON

How the Lower 48 economy aff ects moves to and from Alaska

A growing industry in a state with sky-high consump on

How earning pa erns have shi ed in the last 25 years

ALASKA’S PILOTSPAGE 14

By DAN STRONGAlaska relies more on avia on than any other state

3ALASKA ECONOMIC TRENDS OCTOBER 2015

Alaska’s income gap is smaller, but we have work to do

Heidi DrygasCommissioner

When I go to work every day, I think about how the Department of Labor and Workforce Development can contribute to growth in jobs, wages, and economic security for working Alaskans. This is a daunting challenge considering the re-alities of national income inequality and wage stagnation.

Consider this: Over the last four de-cades, the richest 1 percent of Ameri-cans had 181 percent income growth, meaning their income nearly tripled. Everyone else — the 99 percent — saw income increase a mere 2.6 percent. Men’s wages actually declined over that period. While women’s median wages continued growing until around 2000, they have stagnated over the last 15 years.

Wages have stagnated and inequality has grown even as a growing percentage of Americans earn a four-year college degree. For the fi rst time in American history, rising worker productivity has not translated into higher wages. Such failures in national economic policy are not inevitable — they are a result of more regressive taxation, union-busting, education defunding, and outsourcing.

Set against this bleak national picture, Alaska is better by comparison. Of all states, Alaska has the lowest share of income captured by the richest 1 percent and the highest share earned by 99 per-cent of workers. Unlike most other parts of the country, we have seen real wage growth since 2000, and we have among the highest median wages in America. However, our median wages are still lower now than in the glory days of pipeline construction and blockbuster oil prices. In Alaska and the rest of the country, high-paying construction and manufacturing jobs have declined as a percentage of total employment while lower-paying service sector jobs have proliferated.

The service sector isn’t going away, and we certainly can’t expect large capital budgets in the near future to generate construction jobs. What we can do is expand career ladders, strengthen train-ing programs, and create conditions for wage growth in the service sector, par-ticularly the health care industry. This strategy is necessary to sustain Alaska’s higher-than-average wages and lower-than-average inequality.

Our department recently won a $2.9 million American Apprenticeship Grant from the U.S. Department of Labor, which we are using to expand Regis-tered Apprenticeship and pre-appren-ticeship training programs in the health care industry. We are working with em-ployers like Alaska Regional Hospital, Mat-Su Regional Medical Center, and the Alaska Psychiatric Institute, in coor-dination with labor unions that represent their employees.

Our data show that 47 of the 50 fastest-growing occupations are in the health care industry, and Governor Walker’s Healthy Alaska Plan will create even more job growth in the industry. By working in partnership with employers and unions, we can create more robust training networks and career pathways to improve quality of care and raise wages in this critical part of the service sector.

Health care training should produce better health outcomes for patients and better economic outcomes for our state. As the rest of the country is demonstrat-ing, low wages and rising inequality pose a dire threat to working families’ prosperity. By investing in service sec-tor training and workforce development while maintaining our existing training programs in the construction and oil in-dustry, we can continue Alaska’s median wage growth and protect families’ eco-nomic security.

Follow the Alaska Department of Labor and Workforce Development on Facebook (facebook.com/alaskalabor) and Twi er (twi er.com/alaskalabor) for the latest news about jobs, workplace safety, and workforce development.


By MALI ABRAHAMSON

The number of workers in Alaska and the total amount earned has grown steadily over the past 25 years, but there have been shi s in the

distribu on of those earnings. (See exhibits 1 and 2.)

The percentage of year-round workers making rela- vely low wages — between $20,000 and $40,000

— increased from 28 percent in 1989 to 34 percent in 2014. Conversely, the percentage making moderately high wages — between $70,000 and $150,000 — fell

from 34 percent to 26 percent.

For the small number of workers making more than $200,000 a year, the percentage more than doubled between 1989 and 2014, from 0.8 percent to 1.7 per-cent. That growth came mostly from upper manage-ment occupa ons in the oil and gas industry.

Related to the shi in wages, Alaska’s median wage is also lower now than it was 25 years ago, though it has been steadily rising since 1999. (See Exhibit 3.) All wages in this ar cle are adjusted for infl a on and are in 2014 dollars.

How earning pa erns have shi ed in the last 25 years

Workers and Wages

0

1%

2%

3%

4%

5%

6%

7%

8%Percent of year-round workers

Annual wages

$10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000

$100,000 $110,000 $120,000 $130,000 $140,000 $150,000 $160,000 $170,000 $180,000 $190,000 $200,000

$200

K+

1989 2014

Source: Alaska Department of Labor and Workforce Development, Research and Analysis Sec on

A Higher Share of Workers Are Lower-Wage1 A , 2014 1989



Adjusted for Infl a on, Median Wage is Down3 A - , 1989 2014

The median wage went downIn 1989, Alaska’s median wage was $48,654, the highest over the 25-year period. The state’s economy changed as the service sector expanded in the early ‘90s, bringing in more lower-paying jobs in offi ce administra on, food ser-vice, and retail.

State and local government workers’ wages also dropped signifi cantly as Alaska emerged from the high-demand labor market of the 1970s and 1980s brought on by pipeline construc on and the boom fueled by new oil revenue.

By 1999, the median wage hit its lowest point at $40,350. It has gradually increased since then, to $44,750 by 2014.

More workers with lower wagesTwo-thirds of the numerical growth in year-round workers since 1989 has been among those making less than $50,000 a year. There was li le to no in-crease in the number of workers in the $90,000 to $200,000 range. (See Exhibit 4.)

The high earnersTo help explain some of the shi s, we grouped work-ers into fi ve wage categories and adjusted their earn-ings to 2014 dollars for comparison. (See Exhibit 5.)

About the dataThis article covers only year-round workers, or those who worked in Alaska in all four quarters of the year. Wages and worker counts include full-time and part-time employees and exclude federal civilian and military workers as well as the self-employed.

It also only covers payroll workers, or those who earn a wage or salary. Business owners, including partners in a business who share profi ts but don’t receive a wage or salary, are excluded.

Workers, Total Wages Grew2 A , 1989 2014

Note: Includes year-round workers only.Source: Alaska Department of Labor and Workforce Development, Research and Analysis Sec on

0

$2 billion

$4 billion

$6 billion

$8 billion

$10 billion

$12 billion

$14 billion

$16 billion

0

50,000

100,000

150,000

200,000

250,000

300,000

1989199119931995199719992001200320052007200920112013

Total wagesWorkers

$39,000

$41,000

$43,000

$45,000

$47,000

$49,000

19891990199119921993199419951996199719981999200020012002200320042005200620072008200920102011201220132014


In 2014, the top 20 percent earned 45 percent of Alaska’s total wages. The top 40 percent earned more than two-thirds. The top 1 percent earned 6.5 per-cent.

Median wages fell for all quin les through 1999, but the top 20 percent’s earnings have recovered the most since. In this group, median wages fell by $18,000, or 16 percent, from 1989 to 1999. But by 2014, the median was down just $7,400 from 1989. (See Exhibit 6.)

The mean or average wage among the top earners grew, however, from $124,000 in 1989 to $128,000 in 2014. The reason the median went down but the aver-age went up for this group is that the number and per-centage of especially high earners grew, skewing the average upward. In 2014, more than 40 people earned

more than $1 million, while in 1989 there were just a few.

The low earnersThe lowest 20 percent of earners made less than 5 percent of total wages in 2014. Their wages varied the least over the 25-year period.

This group’s 2014 median wage of $14,700 was about a hundred dol-lars less than it was in 1989. Although these were all year-round workers, many in the lowest bracket worked part- me.

Those in the middleWages for quin les two through four fell considerably through 1999, then had ups and downs through 2014 but didn’t recover to 1989 levels.

In 2014, the second-lowest earn-ing group, group two, had a median wage that was $3,000 lower than it was in 1989. Group three’s wag-es were $6,250 lower, and group four’s were $9,600 lower. (See Exhibit 6.)

More women in low, high bracketsIn both 1989 and 2014, women were much more like-

Yearly Wage Ranges5 A , , 2014



Median Maximum MinimumBottom 20% $14,700 $22,800 – 2nd Quintile $29,900 $36,900 $22,800 3rd Quintile $44,700 $53,900 $36,900 4th Quintile $64,900 $79,500 $53,900 Top 20% $105,500 – $79,500

0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

1989199119931995199719992001200320052007200920112013

Bo om 20%

2nd Quin le

3rd Quin le

4th Quin le

Top 20%

Top 20% Recovered Most6 M , A , 1989 2014

Growth Mainly in Low-Wage Workers4 , 1989 2014


0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000$10,000$20,000$30,000$40,000$50,000$60,000$70,000$80,000$90,000

$100,000$110,000$120,000$130,000$140,000$150,000$160,000$170,000$180,000$190,000$200,000

M


ly than men to earn low wages. More than 60 percent of workers in the bo om 20 percent of earn-ers were women in 1989 and that percentage had dropped only slightly by 2014. (See Exhibit 7.)

There were no ceable increases in women in the overall percent-age of workers and wages in the top two quin les, although in the highest quin le women s ll are just 24 percent of workers and make 22 percent of that group’s wages.

In 2014, the ten lowest earning levels, from $5,000 to $50,000, all had higher percentages of women than men, and the reverse is true at higher earning levels. (See Exhibit 8.) The fact that women are more likely to work part me explains some, but not all, of the diff erence.

Mali Abrahamson is a research analyst in Juneau. Reach her at (907) 465-6029 or [email protected].

Percent Female, Workers and Wages7 A , 1989 2014


0%

10%

20%

30%

40%

50%

60%

70%

More Low Earners Are Women8 P , 2014


0%

0.5%

1%

1.5%

2%

2.5%

3%

3.5%

4%

4.5%

$5,

000

$15

,000

$25

,000

$35

,000

$45

,000

$55

,000

$65

,000

$75

,000

$85

,000

$95

,000

$10

5,00

0 $

115,

000

$12

5,00

0 $

135,

000

$14

5,00

0 $

155,

000

$16

5,00

0 $

175,

000

$18

5,00

0 $

195,

000

Mor

e

Women

Men


Wages and their connection to personal incomeIncome inequality has become a hot na onal topic in recent years, and although the distribu on of wages is relevant to ques ons about income inequality in Alaska, there are important diff erences.

Income includes three main categories: 1) “earnings by place of work,” of which wages are the largest piece; 2) “dividends, interest, and rent,” broadly de-fi ned as investment or property income; and 3) “per-sonal current transfer receipts,” or payments to peo-ple “for which no current services are performed.” This last category includes Medicaid and Medicare, re rement and disability benefi ts, unemployment insurance benefi ts, and the Alaska Permanent Fund Dividend.

Over the period measured, Alaskans’ per capita in-come climbed about 25 percent, though per capita wages rose by only 7 percent. That means we are bringing in a smaller percentage of our income from year-round wage and salary jobs.

Growth in per capita income has come from the dividends, interest, and rent category, which has increased by 20 percent, and from personal current transfer receipts, which have nearly doubled.

0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

19891991

19931995

19971999

20012003

20052007

20092011

2013

Per capita personal income

Per capita wages

Source: U.S. Department of Commerce, Bureau of Economic Analysis

40%

50%

60%

70%

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

2009

2011

2013

Percent of income from wages


By NEAL FRIED

A rising industry for a state with sky-high consump on

the rise of coffee shops

ocha Mo on, A Whole La e of Love, La e Dah, Elim Café, Java Junkie, The Grind, Fish Eye Coff ee, All Hopped Up Brother Expresso, and The Daily Buzz

are just a few of the names that adorn Alaska’s many coff ee houses.

According to the Na onal Coff ee Associa on, 59 per-cent of Americans 18 and older drink coff ee daily, and water is the only more popular beverage. And when it comes to coff ee con-sump on, Alaskans put even their fellow Americans to shame. You could say coff ee shops all over the state contribute to the daily produc vity of Alaska’s work-force through many drips, la es, espresso shots, Americanos, cappuccinos, and a long list of other drinks.

It’s not your imagina onIt is hard avoiding the purveyors of the coff ee bean in Alaska, wherever you live. Fancy downtown glass and steel structures dot the ci es, and coff ee huts are common along some of our rural highways and in ny communi es. They dispense their product from small coff ee huts in parking lots, storefronts in strip malls, freestanding buildings, and the increasingly common coff ee truck.

MLocals and visitors alike o en comment on coff ee shops’ omnipresence in this state, and this ubiquity is no accident. Although there are no statewide sta s- cs for coff ee consump on, according to NDP Group,

Anchorage has repeatedly vied for the top spot in the country for per capita espresso shops. At last count, Sea le had edged Anchorage out of the No. 1 spot na- onally. There is li le doubt the rest of the state shares

Anchorage’s obsession with coff ee.

One popular opinion is that Alaskans drink so much coff ee because of our proximity to Sea le and the strong premium coff ee culture found throughout the Pacifi c Northwest. That’s prob-ably true, as Sea le is the coff ee roas ng center of the world. Our patronage may also have some-thing to do with staying warm in such a cold climate. The top two

coff ee-consuming countries, Finland and Sweden, share similar la tudes with Alaska.

Coff ee shops are everywhereCoff ee shop jobs are counted in the broader category of snack and nonalcoholic beverage bars, which also covers businesses that serve ice cream, frozen yogurt, pretzels, donuts, and cookies. Coff ee shops dominate this category and represented nearly three-quarters of its jobs in 2014.

In 2014, Alaska had nearly 200 individual coff ee opera-tors that had at least one employee, and this doesn’t

Anchorage is No. 2 in the nation for percapita coffee shops.


More Jobs at Coff ee and Snack Bars1 A , A , 2011 2015


1,000

1,100

1,200

1,300

1,400

1,500

1,600

1,700

1,800

1,900

2,000

2011 2012 2013 2014 2015

Employment peaksduring the summer

factor in businesses with more than one loca on, such as Heritage Coff ee of Juneau, Mocha Dan’s of Fairbanks, or Kaladi Brothers of Anchorage, which has 13 diff erent loca ons. This fi gure also doesn’t include businesses run by a single owner/operator, nor refl ect the many places you can buy coff ee outside of these shops, such as in restaurants, gas sta ons, grocery stores, and hotel lobbies.

Growing much faster than averageAlthough the snack and nonalcoholic bar category is small and represents less than 1 percent of statewide employment, it’s con nuously growing. (See Exhibit 1.) In 2014, coff ee shops alone represented about 1,500 jobs.

Growth in this industry’s number of establishments and employment outpaced overall job growth in re-cent years. Between 2011 and 2015, jobs at snack and nonalcoholic drink bars grew by 20 percent versus 4 percent for jobs overall.

These jobs don’t pay much, as they’re o en part- me and entry-level and many begin near the minimum wage. The average annual wage for employees in the snack and nonalcoholic beverage bars industry in 2014 was $13,094, just a frac on of the statewide average wage of $52,848. However, this doesn’t fi gure in ps, which can be a big part of these workers’ take-home pay.

More than just a jolt for some

Besides helping Alaskans get going in the morning, coff ee shops provide other economic and social ben-efi ts that can’t be measured. They’re a primary place to meet with friends or discuss business. For some customers with a laptop, the local coff ee house can be their primary workplace or “portable offi ce” away from home.

Neal Fried is an economist in Anchorage. Reach him at (907) 269-4861 or [email protected].


By NEAL FRIED

1 1970 2014Alaska Migra on, U.S. Jobless Rate Track Together

In 2009, as the na on was in a deep recession, we published an ar cle in the June issue of Trends ask-ing whether that recession, like others in the past,

would aff ect Alaska’s migra on pa erns.

Historically, fewer people leave Alaska during a na onal recession and more move north seeking job opportuni- es. The reverse is also true; when the na onal econ-

omy is fl ourishing and Alaska has a downturn, Alaska is more likely to register net migra on losses.

Now that the U.S. recession has played itself out, it’s

clear it was no excep on — Alaska gained popula on each year from 2009 to 2012 through net migra on, or migra on in minus migra on out. (See Exhibit 1.)

In, out migra on usually cancel outAlaska has signifi cant popula on turnover every year. During the past decade, typically between 40,000 and 50,000 people moved to and from Alaska annually. These common, rela vely large migra on fl ows aren’t always ed to economic condi ons, as people move for a range of reasons including military rota ons, school calendars, re rement, or changing family responsibili- es.

Alaska Migration and U.S. Recessions

How the Lower 48 economy aff ects moves to and from Alaska

-30,000

-20,000

-10,000

0

10,000

20,000

30,000

40,000

0%

2%

4%

6%

8%

10%

12%

19701972

19741976

19781980

19821984

19861988

19901992

19941996

19982000

20022004

20062008

20102013

2014



Typically, the in-fl ows and out-fl ows are about equal so they cancel each other out, and Alaska’s growth comes primarily from natural increase. But the na onal re-cession of the past decade, o en characterized as the worst since the Great Depression, turned Alaska’s net migra on numbers posi ve.

Recovery was long, and nearby states suff eredThe recession offi cially began in December 2007 and ended in June 2009, but the subsequent economic re-covery was slow. The na onal unemployment rate was 9 percent or higher for the next two years and didn’t drop below 8 percent un l 2013. U.S. employment didn’t fully recover recession losses un l April 2014.

Job markets also deteriorated in three of the four states that regularly provide Alaska with its largest numbers of migrants: California, Washington, and Ore-gon. The fourth state, oil-rich Texas, was the excep on.

California’s unemployment rate hit double digits in 2009 and stayed there for four years, peaking at 12.2 percent in 2010. The number of unemployed Califor-nians topped 2 million and stayed there for three years. Oregon’s unemployment rate moved into double-digit territory in 2009 and didn’t fall below 9 percent un l 2012. In Washington, the state most economically aligned with Alaska, the jobless rate peaked at 10.4 per-cent in January 2010 and remained above 9 percent for 2009 through 2011.

Combined, the number of unemployed in these three feeder states grew from 1.1 million in October 2006 to 2.8 million in October 2010.

In 2009, Alaska’s net migra on gain was 3,009, the largest since 1992. In 2010, that jumped to 8,347, the largest since 1985. Then in 2011 and 2012, as the na- on con nued to struggle, Alaska’s net migra on gains

con nued but were smaller.

Migra on muted over meThose numbers are much smaller than past migra ons to Alaska during na onal recessions, such as those of the 1970s and 1980s. Although the na onal unemploy-ment rates in 1983 and 2010 were iden cal at 9.6 per-cent, Alaska’s net migra on in 1983 hit 24,934.

Alaska’s wages were much higher in those early de-cades, and there haven’t been any large projects on the scale of the Trans-Alaska Oil Pipeline construc on act-ing as an a ractant.

Another explana on is that in the long run, migra on

YearAK Total Net

MigrationUnemploymentRate, National

1970 8,040 4.9%1971 5,107 5.9%1972 4,533 5.6%1973 1,287 4.9%1974 6,320 5.6%1975 30,222 8.5%

High NationalUnemployment1976 19,576 7.7%

1977 1,637 7.1%1978 -13,414 6.1%1979 -5,289 5.8%1980 -1,629 7.1%1981 6,326 7.6%


1983 24,934 9.6%1984 14,526 7.5%1985 9,206 7.2%1986 -3,646 7.0%1987 -19,245 6.2%1988 -15,710 5.5%1989 -5,480 5.3%1990 4,637 5.6%1991 6,310 6.8%


1993 1,314 6.9%1994 -4,840 6.1%1995 -6,980 5.6%1996 -3,741 5.4%1997 -3,001 4.9%1998 145 4.5%1999 -2,337 4.2%2000 -927 4.0%2001 -2,676 4.7%2002 2,196 5.8%2003 819 6.0%2004 2,948 5.5%2005 292 5.1%2006 -56 4.6%2007 -2,023 4.6%2008 -1,111 5.8%2009 3,009 9.3%

High NationalUnemployment

2010 8,347 9.6%2011 1,131 8.9%2012 1,113 8.1%2013 -2,870 7.4%2014 -7,488 6.2%

Alaska Department of Labor and Workforce Development, Research and Analysis Sec on

2 1970 2014

U.S. Unemploymentand Alaska Migra on


rates have fallen overall; Americans are simply moving less than they did in the past. Na onal mobility rates hit a historic low in 2011 and have risen only slightly since.

Na onal recovery changed the courseWith the na onal economy in full recovery and U.S. employment reaching record levels, Alaska’s net migra- on turned nega ve in 2013 and again in 2014. The

net migra on loss for 2014 was 7,488, the largest in 26 years. The loss was large enough that natural increase didn’t off set it en rely, leading to a dip in Alaska’s total popula on for the fi rst me since 1988.

This reverse is not a refl ec on of Alaska’s current eco-nomic challenges, though, as the 2014 numbers came before the large drop in oil prices and, more impor-tantly, Alaska has con nued to add jobs through the fi rst half of 2015. It’s more likely that the 2014 drop was due to pent-up demand to leave Alaska that may have built up during the long recession but wasn’t fea-sible because the job market was so poor in the Lower 48 for so long.

If na onal economic condi ons con nue to hold sway over Alaska’s migra on numbers, however, Alaska’s net migra on numbers could remain nega ve, espe-cially with a so er economic picture brought on by troop losses and low oil prices.

Neal Fried is an economist in Anchorage. Reach him at (907) 269-4861 or [email protected].


Alaska’sPilots

Alaska relies more on pilots than any other state

By DAN STRONG

No state relies on air taxis and commuter planes as heavily as Alaska. Many Alaska communi- es are accessible only by air or water, and for

many, fl ights are the only reliable form of year-round transporta on. Because of that cri cal link, avia on provides services here that drivers would cover else-where, including carrying mail, groceries, and supplies and providing medical transport.

Over 1 percent of the state’s popula on has some level of pilot cer fi ca on, which is 3.6 mes the U.S. aver-age. Per capita, Alaskans own six mes the na onal av-erage number of aircra , and the state has four mes

the number of airports per square mile.

Pilots’ contribu on to the state’s economy is just as much of a standout na onally. In 2012, their share of the state’s gross domes c product was $7.5 million, fourth-highest in the na on.

The industry’s backboneAs of July 2015, Alaska had 10,378 ac ve pilots, of which 17.1 percent were commercial pilots and 28.4 percent were airline transport pilots or fl ight engi-neers. The rest were student pilots, private pilots, and fl ight instructors.

Where Alaska’s Pilots Are Located1 B , 2013

Airline Pilots Commercial Pilots

Anchorage22.0%

Anchorage73.1%

All Other7.8%

All Other9.0%

Fairbanks10.3%

Fairbanks4.0%

KenaiPeninsula10.2%

Kenai Peninsula3.3%

Mat-Su9.4%

Mat-Su 2.4%

Ketchikan7.7%

Ketchikan 2.1%

Bethel7.1%

Lake andPeninsula 3.7%

Kodiak 2.5%

Dillingham 2.5%NW Arc c 2.2%

Skagway 2.1%

Juneau12.5%

Juneau6.1%



Wages Around the State2 P , , 2014

AirlinePilots

Commercial Pilots

Anchorage/Mat-Su $145,213 $73,327Northern Region $75,756 $89,778Interior Region $51,899 $57,913Southwest Region $49,864 $54,741Southeast Region $35,332 $54,899Gulf Coast Region $30,443 $61,615

Alaska Department of Labor and Workforce Develop-ment, Research and Analysis Sec on

Plane Crash Rates Climb Through Summer3 A , 1982 2014

0

0.0002

0.0004

0.0006

0.0008

0.001

0.0012

Accidents per capita

AlaskaUnited States

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Airline pilots, the largest group, typically fl y cargo and passengers on scheduled routes using large, mul -en-gine aircra . This group includes their copilots and fl ight engineers.

Commercial pilots fl y fi xed-wing planes or helicopters, some mes on nonscheduled routes, for rescue opera- ons, ambulance services, health care, tourism, fi re-fi gh ng support, and transporta on. Pilots for Alaska’s companies that provide fl ight service to smaller com-muni es are commercial pilots.

Harsh condi ons and long hoursAlaska pilots fl ew more than 5.7 million air miles in 2014, or about 5,492 miles per ac ve pilot.

During those trips, they transported about 179 million pounds of freight and 173 million pounds of mail, which was 5.8 mes the na onal average. They also fl ew 3.3 million passengers, or 1.4 mes the na onal average.

Long trips frequently involve unforgiving terrain, mar-ginal weather, and widely dispersed airports and high-ways. Radio and RADAR coverage is o en limited.

Irregular schedules and a signifi cant me away from home are common. Most pilots are required to abide by Federal Avia on Administra on fl ight duty limita- ons, which restrict their work to between nine and 19

hours at a me. Airline pilots fl y an average of 75 hours a month, and work an addi onal 150 hours on other du es. Commercial pilots fl y fewer hours each month,

averaging 30 to 90, but o en have more responsibili es outside of fl ying.

Commercial pilot work is also more seasonal. In 2014, 40 percent of commercial pilots worked in all four quar-ters of the year versus 63 percent of airline pilots.

Airline pilots na onally tend to be older and more ex-perienced, with an average age of 49.8 versus 45.5 for commercial pilots. In Alaska, however, it’s the reverse — 44 percent of resident commercial pilots are 45 or older versus 37 percent of resident airline pilots.

Flight school and required hoursAlaska has 10 pilot training schools, three of which have Airline Transport Pilot programs, which issue the cer fi -

Source: Na onal Transporta on Safety Board


cate required to become an airline pilot. Trainees must also have a bachelor’s degree and be at least 23 years old. Most begin their careers as commercial or military pilots to get the training and necessary fl ight me, which is 1,500 hours for the ATP.

Commercial pilots must be at least 18 with a high school diploma and commercial pilot cer fi ca on. Cer- fi ca ons require 250 hours of fl ight me and allow pi-

lots to accrue hours for the ATP. Addi onal ra ngs may be required, depending on the aircra and employer.

New pilots at regional airlines generally have about 2,000 hours of fl ight me, and those star ng at major airlines have 4,000 hours. Achieving the entry-level number of hours typically takes less than fi ve years.

Highest U.S. employment Alaska has the highest concentra on of employment for both commercial and airline pilots in the country. Nearly three-quarters of Alaska’s airline pilots work in Anchorage, which is the fourth-highest paying munici-pality in the United States at an average of $145,450 a year. (See exhibits 1 and 2.)

Anchorage also has the na on’s highest concentra on of airline pilot jobs, with a loca on quo ent nearly three mes that of the next-highest metropolitan area. The loca on quo ent is the ra o of the area’s concen-tra on of jobs to the na onal average.

Anchorage was also the top loca on for commercial pilots, though commercial pilots were more spread out across the state. They also made less than airline pilots. In 2014, commercial pilots in Alaska made an average of $82,430, which was 7.7 percent below the na onal average.

Although airline pilot employment is projected to drop by 7 percent na onally between 2012 and 2022, Alas-ka’s employment is expected to grow by 5.4 percent.

For commercial pilots, an cipated employment growth is 9 percent na onally, which is roughly the same as for all occupa ons combined, and 13 percent for Alaska.

Because pilots have a mandatory re rement age of 65, both occupa ons are expected to have very high num-bers of job openings in the next decade.

It’s become safer in recent yearsAlaska has the highest number of per capita plane crashes of any state. The necessity of air travel in Alas-

ka, combined with unique meteorological condi ons and mountainous terrain, make fl ying here more haz-ardous than in most states.

Accidents tend to peak in the summer and early fall. (See Exhibit 3.) Per capita, accidents during peak months are four to fi ve mes higher on average than the lower spring and winter months.

Though Alaska’s per capita accidents remain No. 1 na- onally, the state’s percentage of na onwide crashes

has dropped signifi cantly since 1982. (See Exhibit 4.)

The 1990s were a deadly decade, but a combina on of infrastructure improvements including weather cameras, be er weather repor ng, and advanced GPS tracking systems helped reduce fatal crashes in Alaska by more than half from 2000 to 2010. The oc-cupa onal fatality rate also dropped by 40 percent from the ’90s.

The total number of crashes in Alaska has steadily de-creased, from a high of 220 in 1984 to 79 in 2014. Of those, just 14 involved commercial and airline pilots.

This year, there have been 39 airplane crashes as of July, six of which were fatal. Of those, fi ve total crash-es, one fatal, involved a confi rmed commercial opera-tor. However, more than 40 percent didn’t specify the type of fl ight.

Dan Strong is a research analyst in Juneau. Reach him at (907) 465-6036 or [email protected].

4 , 1982 2014

Source: Na onal Transporta on Safety Board

0

0.00005

0.0001

0.00015

0.0002

0.00025

0.0003

0.00035Accidents per capita

19821984

19861988

19901992

19941996

19982000

20022004

20062008

20102012

2014

Alaska

U.S. average

Crash Rates Have Dropped


All data sources are U.S. Bureau of Labor Sta s cs and Alaska Department of Labor and Workforce Development, Research and Analysis Sec on, unless otherwise noted.1Annual average, 20142Percent change from fi rst half of 2014 to fi rst half of 2015. Data available for 26 ci es. Consumer Price Index – all urban consumers (CPI-U)3Annual average percent change, 2014; Maine and Utah also had 0.4 percent job growth4Seasonally adjusted August rates5Annual average percent change

The Month in Numbers

Prelim. RevisedSEASONALLY ADJUSTED 8/15 7/15 8/14United States 5.1 5.3 6.1Alaska Statewide 6.6 6.7 6.9

NOT SEASONALLY ADJUSTEDUnited States 5.2 5.6 6.3Alaska Statewide 5.5 5.9 6.0

Anchorage/Mat-Su Region 5.0 5.3 5.4 Municipality of Anchorage 4.5 4.8 4.9 Matanuska-Susitna Borough 6.7 7.4 7.2

Gulf Coast Region 5.6 6.1 6.2 Kenai Peninsula Borough 6.1 6.5 6.5 Kodiak Island Borough 3.9 4.4 4.9 Valdez-Cordova Census Area 5.3 6.0 6.4

Interior Region 5.2 5.7 5.9 Denali Borough 3.7 3.8 4.2 Fairbanks North Star Borough 4.5 4.9 5.1 Southeast Fairbanks CA 9.0 9.8 10.6 Yukon-Koyukuk Census Area 15.0 16.5 15.7

Northern Region 9.9 11.4 10.5 Nome Census Area 11.3 13.1 12.1 North Slope Borough 5.4 5.9 5.7 Northwest Arc c Borough 14.4 16.8 15.0

Southeast Region 4.8 5.2 5.4 Haines Borough 5.1 5.5 5.7 Hoonah-Angoon Census Area 9.8 10.9 9.0 Juneau, City and Borough 3.9 4.3 4.4 Ketchikan Gateway Borough 4.7 5.1 5.7 Petersburg Borough* 5.9 6.1 6.8 Prince of Wales-Hyder CA 9.8 10.7 10.7 Sitka, City and Borough 3.4 3.5 3.8 Skagway, Municipality 4.2 4.5 3.8 Wrangell, City and Borough 5.8 6.5 6.3 Yakutat, City and Borough 6.1 7.2 8.1

Southwest Region 10.2 10.8 11.4 Aleu ans East Borough 2.9 3.1 4.0 Aleu ans West Census Area 2.7 3.1 4.1 Bethel Census Area 14.1 15.7 15.7 Bristol Bay Borough 3.9 2.1 4.5 Dillingham Census Area 7.7 7.4 8.1 Kusilvak Census Area 21.2 26.9 22.2 Lake and Peninsula Borough 10.7 8.5 13.9

Job Growth in Alaska and the Na on5

Area Unemployment Rates How Alaska Ranks

7th 50thMississippi$19.39

1stMassachusetts

$29.50

Average Hourly1

Earnings, Private

$27.14

47th 50thW. Virginia7.6%

1stNebraska

2.8%

Unemployment Rate4

6.6%

25th 26thSan Francisco2.5%

1stDetroit

-2.0%

Inflation (Anchorage)2

1.1%

47th 50thW. Virginia-0.4%

1stN. Dakota

3.8%

Job Growth3

0.4%

-4%-3%-2%-1%

01%2%3%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Alaska

U.S.


Safety Minute

Violence prevention plans help keep working teens safeThousands of young people across Alaska have re-turned to school this fall, and many hold jobs at the same time. While many young workers never expe-rience workplace violence, their employers should have a violence prevention plan in place. Alaska Occupational Safety and Health suggests employ-ers fi rst ensure management and staff commitment, which is essential to an effective safety plan.

At a minimum, workplace violence prevention pro-grams should:

• Establish a clear policy for workplace violence, verbal and nonverbal threats, and related ac-tions. All staff should know the policy.

• Ensure no worker who reports workplace vio-lence faces negative repercussions.

• Encourage workers to promptly report incidents and suggest ways to reduce risks.

• Log incidents to assess risk and measure prog-ress.

• Include a comprehensive plan for maintaining security that includes law enforcement or others who can help mitigate violence.

• Assign responsibility for the program to individu-als or teams with appropriate training.

• Ensure adequate resources are available.

For more information, see the U.S. Department of Health and Human Services, Center for Disease Control and Prevention, National Institute for Oc-cupational Safety and Health, Youth Safety. You can also visit www.cdc.gov/niosh/topics/youth/ for related topics.

For additional information on youth safety, call Alaska Occupational Safety and Health Youth Safety at (800) 656-4972 or email the youth training coordina-tor at [email protected].

Safety Minute is wri en by the Labor Standards and Safety Divi-sion of the Alaska Department of Labor and Workforce Develop-ment.

Employer Resources

Alaska Career Ready saves employers time and moneyThe Alaska Career Ready program helps connect businesses with a qualifi ed local labor pool by help-ing emerging, transitioning, and current members of Alaska’s labor force earn the National Career Readi-ness Certifi cate, or NCRC.

Developed by ACT and adopted nationwide, the NCRC is a portable, evidence-based credential that certifi es the holder has basic, essential workplace skills. For businesses, hiring applicants who hold the certifi cate helps reduce hiring costs, increase produc-tivity, and decrease unnecessary turnover.

Applicants can earn the certifi cate at an Alaska Job Center by taking WorkKeys assessments in applied mathematics, locating information, and reading for

information. To date, more than 41,000 Alaskans have earned the NCRC at the bronze, silver, gold, or platinum level.

Alaska Career Ready allows businesses to collabo-rate with Alaska Job Center Business Connection professionals to recognize or request the NCRC on job orders as proof of essential workplace skills. This employee selection and development program is available at no cost. For more information, please contact one of the job centers at www.jobs.state.ak.us/offi ces/index.html.

Employer Resources is wri en by the Employment Training Ser-vices Division of the Alaska Department of Labor and Workforce Development.

October 2015 Trends - Alaska Dept of Labor · 2 OCTOBER 2015 ALASKA ECONOMIC TRENDS OCTOBER 2015...

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